What No One Tells You About Inflation

If I gave you two million dollars, what would you do with it? The answer explains this weird recession.

Image by Allange from Pixabay

So you won the lottery, a cool two million dollars in your pocket. You rush out to buy a house, a Ferrari, and the dream vacation you always wanted. The economy will thank you for it, and happily accept your money.

But what if thousands of people won? The market would adjust prices of houses, Ferraris, and vacations to weed out the sudden demand. You might have two million, but you can’t afford the Ferrari anymore so you hold off on that.

But what if everyone won this lottery? There aren’t enough tradesmen to build all the McMansions ordered. Ten new Ferrari factories couldn’t churn out fine machines fast enough. Tourists would choke every destination.

That’s exactly what happened.

With interest rates at record lows for over a decade, investors and developers were treated to what they call “free money”.

But what does that look like on the ground?

Where Is Everybody?

We arrived at the hotel at 3pm. The lone person at the desk told us our room wasn’t ready yet. What? Check out was at 10, five hours ago. How could they not…